Joan Wall

Monday, 22 July 2002 09:39

More than a wing and a prayer

As a young entrepreneur, Mike Mizesko didn’t have much trouble obtaining capital.

“Chase Manhattan Bank gave me a $1 million line of credit with no personal guarantees — unsecured,” he remembers. “For a bank to do this, they’ve got to have a lot of confidence. Now I was 25 — and it wasn’t because they liked my face.”

It was, he says, because of the initial investors he had rounded up for the company, which, founded in 1984, was at that time on the cutting edge of technology making touch screens for kiosks.

“I had a board of directors that was to die for,” he says, noting it included the founder of Hickory Farms and the head of a division of Saatchi & Saatchi, a worldwide advertising firm. “My lead investor was a guy that taught new venture management and entrepreneurship at my business school.”

Mizesko, who sold the company in 1989, knows many entrepreneurs aren’t so fortunate, so he’s trying to increase their chances of finding the right investors.

As an investment banker with Helston Capital Group in Columbus, Mizesko is president of OhioAngels.com Inc., which is designed to provide an online means for matching private capital with emerging and early stage Ohio businesses.

Angels don’t want to be found, he says, and entrepreneurs don’t always know where to look — or how to decide whether a particular angel will be good for the company.

“It’s very random,” adds Brad Beasecker, CEO of OhioAngels.com and co-founder and president of Helston Capital Group. “For example, if you are a successful entrepreneur in your own right and have a 30- to 40-year history in the plastics industry, the chance you might see an investment opportunity in the industry is very small. [But] that’s where your knowledge and expertise will be most helpful to that entrepreneur.”

“What we’ve done is create a technical infrastructure, a portal, that allows investors to come and learn about investing and learn about various industries and technologies and companies — and allows them to do it anonymously,” Mizesko says.

The initiative was launched this spring as a partnership between Helston and the Ohio Department of Development. Other sponsors, which include accounting, law, venture capital, technology and financial services firms, will provide content to the site to help educate participating investors and entrepreneurs.

Investors begin with a free portal page, which qualifies them online and gives them an ongoing stream of editorial content about private investing, entrepreneurship, events in their community and relevant emerging businesses and technologies. They also have access to unidentified business plan summaries that match their interests.

A full, one-year membership, at $250 for individual investors or $750 for institutional fund investors, gives investors:

  • Full access to the detailed business plans — including the names of the entrepreneurial companies.

  • The ability to participate in the process of reviewing business plans submitted to OhioAngels.com.

  • Access to deal-specific messaging and comments.

Entrepreneurs also can register for a free portal page that includes the editorial content and an eight-week period to build a business plan abstract — with how-tos from OhioAngels.com.

They then can submit the plan, with a $100 fee, for review and possible acceptance by a team of investors registered as full members on the site and site sponsors. Feedback is provided to the entrepreneur.

Plans accepted by the team can be posted to the portal with an additional charge of $650 and an agreement with an affiliated broker-dealer.

“The key is how do we get people who are serious about raising money to participate,” Mizesko says, noting the site is not meant for entrepreneurs who are not in the market to actively seek capital.

Within two weeks of OhioAngels.com’s May 3 launch, 80 entrepreneurial companies and “a few dozen” investors were registered, Mizesko says. More should follow, he says, given that 86 percent of the venture capital raised between 1995 and the middle of 1998 by Ohio entrepreneurs with sales of less than $3 million came from individual accredited investors.

“Part of what came out of [that] study is about $150 million a year is being invested by accredited investors — angels — into private companies in the state,” Mizesko says.

The trick, Mizesko and Beasecker say, is to find the right investor for the right entrepreneur. It’s not just the money entrepreneurs need; it’s also the right person to mentor them and help develop their skills.

“This is not for all accredited investors,” Beasecker says. “It’s for people who take an interest in developing companies.” How to reach: OhioAngels.com, www.ohioangels.com, 262-5568.

Joan Slattery Wall (jwall@sbnnet.com) is an associate editor and statehouse correspondent for SBN.

Monday, 22 July 2002 09:38

Curtis McGuire

Roger Geiger probably couldn't believe his ears.

Four years ago, the executive director of the Ohio office for the National Federation of Independent Business received a call from Curtis E. McGuire, CEO and owner of Redleg's Lumper Service Inc. in Columbus.

"He said, 'I'd like to meet with you and find out how I could become more involved in the organization,'" Geiger remembers.

As head of an organization that usually must go on a recruiting mission to find volunteers, Geiger was impressed with McGuire's passion and initiative.

"It is a rare gem for somebody to proactively say, 'I really believe in what you do, so I'm going to do more than write you a check; I'm going to give you what's even more valuable, and that's some volunteer time and effort,'" Geiger says.

Now McGuire serves on the NFIB's Leadership Council, helping to set priorities for the organization and manage its programs.

McGuire says he follows two key issues: taxes and employees, the latter imperative to his company, which provides workers to load and unload truck deliveries. His 8-year-old lumper service cracked the $1 million mark last year. He runs it, for the most part, from his home, with offices in the buildings of some of his clients.

As he expands from serving Columbus companies -- including Abbott Foods and Consolidated Stores -- into other states such as Alabama and Colorado, he strives to grow his work force beyond the nearly 60 employees he has now.

Perhaps it's the marksman skills he's developed as commander of a National Guard artillery battery in Piqua that help him seek out and target opportunities rather than wait for them to cross his path.

In the Guard, McGuire is finishing a class to become a major. In fact, he says he'd have chosen the military as his career if he hadn't ended up starting the lumper service, which -- incidentally-- makes use of a nickname for field artillery men: Redleg.

In his opinion, every young man should have at least two years in the service, where he says he did a lot of growing up.

"You find out quickly nobody's going to make your bed and somebody is bigger than you and does have power over you," he says. "You've got to have respect for yourself."

Another mantra he follows: "Just don't accept failure. Promote and reward excellence; be ruthless against failure."

It's a lesson in discipline he learned from two mentors: a battalion commander in the Guard and a teacher in the junior academy where he attended school in Brooklyn.

His mother also raised him with those values: "You will do the work. That's it. Period," he says.

McGuire's hard work and determination are among the reasons Linda Reidelbach chose him for her campaign staff as she runs for Rep. Pat Tiberi's seat in the 26th Ohio House District this fall. McGuire collects resources and information to keep her abreast of changes or items she might want to include in her literature or speeches. He also helps her network with the business community.

"Curtis not only has his own business, but he's also interested in doing things that are positive for other business owners as well, and that includes his activity with the Northland Area Business Association and the NFIB," Reidelbach says. "His caring and his activities certainly go beyond what he's getting for himself."

McGuire also is a member of the Governor's Small Business Advisory Council; an assistant coach for the girls' softball team at his daughters' Catholic school, St. Anthony; a board member of Shiloh House, an elderly daycare center in Dayton; and a Mason at Successful Lodge #17 in Columbus.

"I think he's a man who feels he's been very blessed and given some great opportunities in this free enterprise of ours, so he's looking for ways to give some volunteer hours back to others who are coming in behind him," Geiger says.

McGuire has been an active spokesperson for NFIB, testifying on the state and federal levels on key issues.

"He puts a great face to our issues," Geiger says. "He's articulate; he's passionate. What he does in such a great way is he makes it very real for politicians and bureaucrats. He can, in a straightforward, passionate and yet simplistic way, look politicians in the eye and say, 'What you're doing here today -- this is how it's going to impact my small business.'"

McGuire's involvement in business and community activities, however, doesn't overshadow another passion in his life -- his wife of 14 years, Nancy, and his daughters, Danielle, 12, and Samantha, 13.

In fact, he considers fatherhood the greatest challenge in his life: "Raising kids and making sure you do it right and don't slip up in front of them."

His children are also the answer to the question of what he considers to be his greatest accomplishment. "I haven't reached it yet, but I know it," he says. "I want to see my girls walk across the stage at college with a diploma and say, 'Mom, Dad, we graduated -- we did it successfully.'" Joan Slattery Wall (jwall@sbnnet.com) is associate editor of SBN Columbus.

Monday, 22 July 2002 09:38

Net savings

Nick Nicholson was hired to grow The Ecology Group Inc. rapidly, and he has.

The North Columbus business provides waste and recycling expense management to 75 clients throughout the United States and Canada with a network of 1,400 haulers across the country. When Nicholson began working with The Ecology Group four years ago, the company had one-third as many clients. Since he came aboard as president and CEO, sales have more than doubled, exceeding $50 million.

All the volume moved Nicholson to find a way to use technology to whittle down the mass of details that went along with the increased business.

"We needed to make the back room scalable," he says.

To accomplish the goal, The Ecology Group has implemented an Internet initiative, dubbed eTEG, to help manage the load of haulers, clients and services coordinated by the company.

He dedicated a company vice president to the effort and hired two technical experts to program and administer the e-commerce end. The initiative required a $50,000 investment for upgrading the company's systems to supply fast Internet access from anywhere in the world and a high-end computer server with phone systems -- including a T-1 line -- to support it.

By dealing with invoices, service requests and payments electronically, Nicholson hopes not only to benefit haulers and clients by improving record keeping and cutting the billing and payment cycle, but to impact his bottom line.

Already he's reaping time and cost savings that should increase once a majority of the haulers and clients take advantage of his e-commerce services. The results are likely to be even more significant in the months to come because he expects sales to continue to grow as well as the net income's ratio to sales.

"It will about quadruple our bottom line because of the savings," Nicholson says of the e-commerce initiative.

He expects to meet the goal by the middle of next year.

An easier way

The Ecology Group's e-commerce initiative is divided into three sections: eHauler, eClient and eService.

"We receive, for example, around 25,000 invoices every month from haulers all over the United States, including Alaska and Hawaii, and Canada and Puerto Rico," Nicholson says. "We needed a way to process the invoices rapidly, and we have really been working on electronic ways to do that for the past three years."

The company started by scanning standardized invoices from major haulers and having employees enter into computers any handwritten invoices from haulers in some rural areas.

The eHauler initiative, on the other hand, involves what Nicholson calls reverse invoicing.

"For example, in Columbus we work with Waste Management that way. There's around 50 services they provide for our clients here in town," Nicholson explains. "So at the beginning of the month, we send them an electronic invoice. We say, 'Check this over and turn it around as quickly as possible, hopefully within seven days, send it back to us, and we'll get you paid.'"

He also expects eHauler to help his company deal with complications caused by mergers in the industry, which result in changes in invoicing procedures, and missing or incorrect bills from haulers. The mess leaves The Ecology Group with a tremendous amount of follow-up phone calls and faxes, which could be reduced by electronically compiling and sending the information back and forth.

For example, in February, 52 percent of the invoices The Ecology Group received did not match the contract rate in its computer.

"This causes us a lot of hassle and delays," he says. "So, let's streamline: Take something that now takes 45 or as much as 70 days to get it down to 20 to 30 days or even better."

Nicholson hopes haulers will take advantage of another ability he has: depositing client payments electronically directly into the haulers' accounts. That would be helpful because, as a management company, The Ecology Group acts as the middleman through which payments are distributed. Take, for example, a large client like Consolidated Stores, which uses a variety of waste haulers because its stores are located across the country.

"Once a month, we send them a consolidated invoice, they send us one check, and we take care of distributing and paying the invoices for them to all the haulers throughout the United States," he says.

With eClient, The Ecology Group sends an e-mail to clients outlining individual stores and the monthly charge. The client can review that and send back a check -- hopefully electronically.

"We receive about $1 million a month electronically," Nicholson says, noting approximately 20 percent of his clients receive bills and reports electronically.

The company's eService is a similar concept The Ecology Group is implementing to help clients submit service requests.

Typically, he says, it takes 3.4 calls for a client to get an extra service or get something done through a hauler. Through eService, the client sends an e-mail for a service request to The Ecology Group, which pledges to let the client know the status of his or her request within an hour or the requested service is free.

As more haulers go online, The Ecology Group will pass the e-mail service request right through to the hauler.

"So we don't play telephone tag or pass things back and forth, and it's easier on both of us," Nicholson says. "We will be able to do a much better job of serving and tracking what's going on."

The game of persuasion

The entire process of using e-commerce has been an evolution for The Ecology Group, with the challenge of convincing clients and haulers to come on board.

"We started off in a rather humble way of just using scanning in house, but now we've expanded it to the Internet. We have about 20 percent of our clients and about 5 percent of our haulers using it," Nicholson says. "Hopefully, we can get it to 80 percent of both."

The company is making significant efforts to encourage participation. Among them: offering to provide computer hardware and software, as well as Internet access, at a minimal cost to clients and haulers not yet connected to the Internet. So far, Nicholson has had no takers.

In other cases, he is making inroads.

For example, The Ecology Group is linking into one client's accounting system to complete the electronic process there; another client has loaded its own software onto a computer for The Ecology Group to use.

Nicholson has yet to wring a lot of transaction costs out of the entire process, but he's seen the relationships between his company and the haulers and clients improve because of the increased communication that comes with implementing the technology.

He is realizing savings, however, in his cost to process each invoice.

"It used to cost us probably around $7.41 to process the old manual way, and now the cost is down to something like $2.29 -- and dropping -- for the electronic way," he says. "Once we get it into a grooved swing, it will be down to the pennies." How to reach: The Ecology Group, www.eteg.com, 459-3265

Joan Slattery Wall (jwall@sbnnet.com) is associate editor of SBN Columbus.

Monday, 22 July 2002 09:36

On the offensive

Steve Sasser says in the 24 years he's been in business, he's never seen things move as fast as they do now.

Hence, the president and CEO of Symix Systems Inc. must move his own company even faster -- a task that's requiring him to change the way his $133 million public company does business.

"We have to reinvent ourselves," Sasser says. "That's the process we're going through right now -- a very rapid metamorphosis to reinvent ourselves."

Sasser describes today's Symix as "the recognized leader" in enterprise resource planning -- allowing mid-sized manufacturing companies to electronically control all facets of their businesses, from ordering to delivery, from costs to profits.

His description of the Northeast Columbus company changes, however, when he looks at the future of Symix, which he expects one day to be the recognized market leader, not just in ERP, but in all e-business for manufacturing as well as distribution companies.

That means his customers will rely on Symix to provide solutions for electronically coordinating their businesses not just from within but also with the outside world of clients and suppliers.

Already, Sasser's been successful in growing and guiding Symix through turmoil in the technology realm. The company has grown from a $40 million business when he joined it in 1995 to $129 million this fiscal year. That includes more than $5.5 million in e-business-related products and services sold to approximately 75 companies since Symix launched its e-business efforts in January.

The company's nearly 30 percent annual growth rate is now flattening out -- even taking a dip into the red -- as it prepares for its latest metamorphosis. This summer, Symix released its fiscal year 2000 results, showing a net loss of $10.1 million. In the previous fiscal year, it realized net income of $4 million.

Sasser expects investment in e-commerce, supply chain management and customer relationship management -- issues that will matter most to his customers -- to drive future growth and return Symix to profitability in the second half of this fiscal year. By 2001, he expects it to resume its fast growth, possibly showing increases as high as 50 percent annually.

Coaching changes

When Sasser joined Symix five years ago, the company faced a great opportunity in the ERP market, he says, but it just wasn't playing its best game.

"The company was not strategically in sync with the basics like product development, product deliveries and what the sales channel was selling," he says.

His first move was to improve the coaching staff.

He brought in a new management team, including new faces in development and human resources, as well as a new CFO. New second-level management also came on board, many of whom had worked with Sasser in previous positions at Goal Systems, a company that was later purchased by Legent Corp. and then by Computer Associates.

Sasser's goal: "We were looking for, first, people who understood how to build a software business; had business sense and values to build a quality, world-class company; and who had experienced bigger situations."

He wanted executives who had managed businesses the size of what Symix would become.

Under their leadership, Symix began to grow through acquisitions, including operations in France, Australia and Germany.

Sasser expanded the company's product line from ERP to CSRP -- customer synchronized resource planning. This meant a whole new view for Symix. Previously, it helped manufacturing businesses, well, manufacture. It was a view of the inside of the client company.

Now, Symix turns to what Sasser calls "the outside game" -- helping manufacturing and distribution companies coordinate the entire supply chain among themselves and their suppliers and their customers.

"It's about making customers happier, driving revenue and making suppliers better," Sasser says.

He also changed the reward and measurement system for employees, specifically on the sales side, to help them better understand where the company was headed.

Those moves created a foundation from which Symix could launch its latest transformation, but to Sasser, they're ancient history.

"The only relevant part to all that is through its 20-year history, the company has been able to see market changes, anticipate market changes, lead those changes," he says. "It's the test of time, a test of making the company ready to play pure offense now in the new economy."

A new game plan

Because its industry is growing so rapidly, the only way for Symix to keep up is to anticipate where it needs to be -- and get there before the boom arrives.

Four years ago, Sasser recruited Jorge Lopez as vice president of corporate development and strategic planning. He's a key player in keeping Symix ahead of the game.

"My role is to try to understand what's happening out there, or even better, what should be happening," Lopez says. "We think we're better off building a future we have imagined than to try to figure out someone else's vision of the future."

To do this, he does a lot of "scenario planning."

"It's not like you're predicting the future like a fortune teller," Lopez says of scenario planning. "What you're trying to do is get some of the likelihood of things occurring."

He not only looks at the likelihood, but examines what options Symix would have should each scenario hold true.

"It turns out that change is accelerating," Lopez says. "So I think the best you can do is to try to map out as many different scenarios as you think you can do based upon the different forces you think are shaping the future.

"It's actually a fun game," he continues, adding that businesses large and small can use the tool of asking "What if?" and, more important, coming up with answers.

For example, Symix, and every software company, Lopez says, deals with the possibility that everything it sends out now on a CD-ROM might eventually be available on the Internet.

"The customer may achieve the same ends by using a browser and pointing to a Web site that has that software already installed and operating," he says. "Instead of using software and buying software, they're becoming a subscriber to a site."

Symix saw the scenario as a very important piece of the future.

"What we've done in the past is, we've delivered software," Lopez says. "So we adjusted the business model to account for the fact that all this value is moving to the Web."

Symix, then, is predicting that companies will increasingly use the Internet to conduct business -- not just internally, but with their supply chains as well.

"We think the Web will continue to provide a facility for companies to work together in buying and selling," Lopez says, "so what we're concentrating on is the infrastructure required to do that."

Lopez points out he's not solely responsible for creating the company's vision.

"This is not 'The Jorge Lopez Show,'" he says. "It's more like you're part of a movie. There's a producer, writer, actor. I'm more in the producer role where I'm trying to get everyone to take a look at the new ideas and see if they make sense."

The process to change Symix's business model to facilitate that concentration is not something the company's executives just started.

"Accounting firms say, 'We can audit your books over the Web.' It takes the travel costs they're able to save and reduces the costs of doing the audit," Lopez says. "There are HR capabilities on the Web, payroll. So it's a very real, real scenario, and we're not fighting it.

"We actually, two years ago, sat down to think about this and realized we could take advantage of it if it occurred."

No time outs

Once Symix created its vision of the future, it had to make moves to get there faster, Sasser says, or risk coming in late behind competitors.

One of its first moves was to create a subsidiary, called Frontstep, dedicated to scouting out new clients and markets in e-business. Frontstep also is changing Symix's business model from primarily a direct sales mode to a channel strategy -- indirectly selling through partners including resellers and service providers.

"Frontstep is an e-business subsidiary created to accelerate our evolution of our company from what we used to be to what we want to be," Sasser says. "Basically it's our response to what's going on in the marketplace."

In May, Morgan Stanley Dean Witter Private Equity and Updata Venture Partners provided $13.6 million in financing to accelerate Symix's business plan through Frontstep. The money will be used to advance the company's business-to-business software suite, add new indirect sales channels and target markets, transition to new software delivery and pricing models and develop new strategic partners.

Still, Sasser notes, the partnership carries with it other benefits: Both investors "are highly-regarded names in the financial community, and their industry knowledge and associations will be valuable resources to us as we move forward."

Already Frontstep has helped Symix attract new markets: distribution companies and online trading exchanges.

"As you start building infrastructure for companies, you get measured against companies that built infrastructure in the past, for example SAP or Microsoft. SAP was very successful in selling software to businesses to manage their internal operations," Lopez says. "We're basically at the beginning of a new venture backed by the resources and skills of a public company."

In addition, a services group within Frontstep, called brightwhite, helps clients rethink their business models and use the Web.

"The significance of brightwhite at this early stage of the market is to do a good job of explaining what e-business is and provide a map toward the particular kinds of results a client wants," Lopez says, noting brightwhite might change as a result of the e-business marketplace.

"It could move to implementing a more standard kind of service built around products as they mature into a marketplace that has also matured because it understands things better. At the same time, it will be looking to adopt new things that are not well understood by the marketplace. So that would be a core competency for brightwhite," he says.

"We'll let it be the pioneer," Sasser agrees.

As for Symix as a whole, management is making sure it is ready to respond as the company's focus turns to these two new, promising parts of the business.

"Realistically, we're also managing an existing ERP business that customers still pay good money for," Lopez says. "It sort of matures to the next level so you have multiple business models within the same corporation."

Symix has doubled its research and development investment in the last year to support its new e-business strategy.

"We are creating a new image for Symix," Sasser says, "that we're with it -- we get this e-business stuff."

Early in the game

Already, Symix's offensive moves are scoring through Frontstep and brightwhite.

For example, eAmigo.com, a business-to-business trading portal that facilitates trade relationships between Latin American manufacturers and North American buyers, uses eStep Messaging, Frontstep's collaboration and communication solution, to speed the buyer/seller registration and application process.

Frontstep also has created partnerships to extend Symix's reach.

In February, Frontstep partnered with Commerce One Inc., giving Symix customers the ability to leverage Commerce One MarketSite Global Trading Portal to buy or sell products and services worldwide and to build and automate supply chain processes online.

As Symix continues its metamorphosis, Sasser expects a short break in the game during which his team can regroup.

"I think the business will grow much slower in the next couple of quarters," Sasser predicts. "In fact, we've been in a period of basically flat business. As the market matures, we'll start growing at a 30 to 50 percent clip again in 2001."

"We do believe e-business is here," Sasser says. "It's just starting, but it's real and it's significant. So we're going to rebuild the company around an e-business." Joan Slattery Wall (jwall@sbnnet.com) is associate editor of SBN Columbus.

Monday, 22 July 2002 09:34

Know the score

There's no question sports is big business in Central Ohio.

But how do you know if you should join the game?

John F. Wolfe, chairman and CEO of The Dispatch Printing Co., made the decision to enlist his company as a 10 percent player in both the Blue Jackets and Nationwide Arena because of the big picture.

"I think it's part of the whole culture in the revitalization of Downtown. When you do business in a city, you have to have a vibrant and economically viable city," he says, voicing his view that the Arena District will add to the quality of life in the area.

Cities that don't offer amenities including sports and entertainment, he says, will have a difficult time recruiting employees and retaining businesses.

You don't have to be a big player to be involved in sports sponsorships, which on a smaller scale could directly help your business.

Mindy Sanford, Columbus marketing coordinator for HealthSouth, says sports sponsorships make up 20 to 25 percent of her advertising budget. HealthSouth is the sports medicine provider for both the Columbus Clippers and the Columbus Crew teams.

"We can hit an audience that is sports medicine oriented," she explains. "Sports-minded people go to these events, and if they get injured they can come to HealthSouth for physical therapy or urgent care."

As a sponsor of the Clippers, HealthSouth gets its name on outfield signs and the scoreboard, plus an ad in the program. In addition, HealthSouth works with the team's athletic trainer to provide rehabilitation services for the athletes. In the same way, HealthSouth works with the Crew's athletic trainer, but with that team, the company has signs on the field, loge seating and commercials during televised games.

"It gives us national recognition as well, since the Columbus Clippers and Crew are seen not just in Columbus but in other places throughout the country," Sanford says.

Have a game plan

Sanford stresses that any business considering a sports sponsorship should first make sure the move will reach its target audience.

"Just because sports are so popular now, you're going to get a lot of exposure to a lot of different people, because it's the cool thing to do to go to the games," she says. "Even if you don't like the sport, it's the cool thing to do."

That works well for HealthSouth, since its target audience is the general population as far as the company's urgent care services are concerned.

Sanford also knows athletic-minded people attending the games are prospects for the company's other services, such as a program designed to increase athletes' speed and acceleration abilities.

Shawne Beck, director of marketing for the Columbus Clippers, says sports venues have great diversity in their fans, so businesses can use marketing there to hit many different demographics.

"With minor league baseball, our tickets are not outlandish. Easily a family of four can come to a game and be able to get in for under $20," Beck says. "We're an attractive market for advertisers because not everybody can afford to go to an Indians or a Reds game or to an NFL game."

He says there's another advantage to sports sponsorships over, for example, a direct marketing mailer, which recipients could throw away without opening.

"In a sports venue," he says, "you're looking at a captive audience."

Sanford says sports teams will work with companies to tailor sponsorship packages to their needs, a point emphasized by Beck.

"If they are interested in an on-field promotion they might have seen at another ballpark, we try to devise a promotion for them that works for their particular company," he says. "Obviously I don't want to do a sumo race for Jenny Craig. You obviously don't want to do something that conflicts with their company's image."

Prices for sports sponsorships vary widely, he explains, depending on what the business wants to do. For example, $1,000 would cover an ad in the Clippers' program; six-figure sponsorships would make a company title sponsor for an evening and include tickets, signs within the ballpark and more.

Get a home field advantage

Sports sponsorships not only can increase marketing efforts toward potential customers but can benefit your company internally.

Tom Harris, senior manager of company communications at Honda of America Mfg., says Marysville employees reap rewards from Honda's sponsorship of Championship Auto Racing Teams.

"The associates here in Central Ohio that build these thousands of Honda products are in that racing spirit and are racing enthusiasts in their own right," Harris says.

To bolster that enthusiasm, Honda brings CART racers and cars to its Marysville facilities when they're in town for races at the Mid-Ohio Sports Car Course. Employees seek autographs, meet the teams and enter drawings for tickets to the races.

In addition, Marysville employees can relate to racing because the same engineering dedication to improve and enhance performance is inherent in the philosophy of the Honda production system.

"Going back to the days when Mr. [Soichiro] Honda first started the company, he was a racing enthusiast, so the spirit of racing is strong within Honda," Harris says. "It's a real driving force in our engineering and technology design focus." How to reach: Mindy Sanford, HealthSouth, 825-9677; John F. Wolfe, The Dispatch Printing Co., 461-5000; Tom Harris, Honda of America Mfg., (937) 644-7714

Joan Slattery Wall (jwall@sbnnet.com) is associate editor of SBN Columbus.


What you can do

If you think a sports sponsorship may be right for your company, here are some local contact names and numbers to get you started:

  • Championship Auto Racing Teams: Terry Kalna at ISL, (248) 764-1570

  • Columbus Blue Jackets: Mike Humes, vice president of business development and sales, or Paul D'Aiuto, executive director of sales, 246-4625

  • Columbus Clippers: Shawne Beck, director of marketing, 462-5250

  • Columbus Crew or the Crew Stadium: Matthew Klidjian, director of corporate sales and marketing, or Andrew Arthurs, vice president of sales and marketing, 447-2739

  • The Ohio State University Athletic Department: David Brown, director of marketing and promotions, 292-0824

  • Sports Management Inc., which assists sports organizations and corporations in sponsorships: Tom Mueller, president, 899-9476

Monday, 22 July 2002 09:34

A loan with a bonus

The U.S. Small Business Administration is augmenting its efforts to bring traditionally underserved markets into the mainstream economy.

This summer, the administration expanded nationwide a pilot program that matches loans and technical and management assistance to entrepreneurs.

The Community Express Loans are a joint initiative between the SBA and the National Community Reinvestment Coalition and are aimed at areas usually comprised of small businesses owned by minorities, women and veterans, particularly those located in low- and moderate-income urban and rural areas.

The loan provides an 80 percent guaranty to banks for loans up to $100,000 and 75 percent for loans above that figure. The maximum loan in the program is $250,000.

"It means, in the unlikely event there was a default, SBA has 80 percent of the loss and the bank has 20," explains Jane Butler, SBA's associate administrator for financial assistance.

In comparison, a similar SBA loan, the SBA Express Loan, offers a 50 percent guaranty for loans up to $150,000.

"We have had lenders beating down our doors interested in the product," Butler says. "We will make it available to all of our preferred lenders."

Already the loans are available in cities including Cleveland, Akron and Pittsburgh. The SBA's Columbus office is in the process of informing banks of the new program to encourage their participation.

Daren Maloney, senior vice president in the business banking group for Bank One Cleveland, says the increased guaranty allows the bank to grant loans it would not have otherwise.

"The bank takes on some additional risk, as does the SBA. It's an increased shared risk," he says.

As part of the pilot project Bank One began in the summer of 1999 in Cleveland, Milwaukee, Detroit and Chicago, 19 loans were closed for more than $1.7 million, he says. Bank One is expanding the program to other areas.

Among all the banks participating in the pilot program, more than 110 loans totaling about $11.1 million were granted. Banks are permitted to use their own documentation in an effort to expedite the process.

The SBA hopes entrepreneurs, too, will be interested in the new loan.

Technical assistance is paid for by the participating bank, which contracts with local providers to give the business owner help with business planning, basic business finances, tracking receivables, identifying resources that could assist with marketing and sales and other kinds of networking.

"What we have committed to do besides making the capital available for the client," Maloney says, "is try to give them technical assistance on the front and back end of the loan. We want to make sure they have a sound business plan and that, when we close the loan, we don't simply walk away and wish them well."

"In a lot of areas, they're contracting with Small Business Development Centers, so technically we already do have that kind of assistance available in the city," says Doug Sweazy, business development specialist in the SBA Columbus District office.

"Each loan application would be different, but with the technical assistance being provided, it should be advantageous to any small business starting out or just in the process of its first expansion," says Frank D. Ray, district director in the SBA Columbus office.

The loans include term loans, lines of credit and commercial mortgages. Loan proceeds can be used for purchasing inventory, machinery and equipment, land and buildings, and for working capital.

"Hopefully," says Gil Goldberg, district director of the SBA's Cleveland office, "that technical assistance and advice makes the loan a better loan and a better investment for the taxpayer." How to reach: U.S. SBA, www.sba.gov, (800) 827-5722 or, in Columbus, 469-6860. Other SBA offices: Pittsburgh, (412) 395-6560; Cleveland, Akron and Stark County, (216) 522-4180

Joan Slattery Wall (jwall@sbnnet.com) is an associate editor and statehouse correspondent for SBN.

Monday, 22 July 2002 09:33

Less taxing

Next year, when the tax man cometh, companies that do work in many cities in Ohio will have a much shorter stack of paperwork.

Provisions of Substitute House Bill 477 take effect Jan. 1 and create uniformity for municipal tax filings across the state.

"[Under current law] it's not unusual for a small contractor to have to fill out 40, 50, 60 returns -- in addition to your federal income tax return and your state income tax return," says Donn Ellerbrock, vice president for governmental affairs for Associated General Contractors of Ohio.

Luther Liggett Jr., a law partner with Columbus-based Bricker & Eckler LLP, explains that current law requires employers to withhold tax and file forms for any employee working within a municipality's limits, even if neither the employee nor the employer reside in that city.

Contractors who, for example, go into a subdivision for a day or two of repairs may end up owing only a few dollars, says Liggett, who also is a legislative agent for a variety of construction associations, such as the National Electrical Contractors Association.

"Interestingly enough," says Ellerbrock, "before 477, frequently firms would have to spend more to comply than they owed."

The new law's benefits, effective Jan. 1, 2001, include:

  • A city cannot tax income if an individual performs services on 12 or fewer days in the calendar year and neither the employee's residence nor the company's principal place of business are in the municipal corporation. That individual's employer will not have to count such compensation in payroll factors used to report the business's income to the municipal corporation.

    In addition, the law says no municipality may require any nonresident employer to deduct and withhold income taxes "unless the total amount of tax required to be deducted and withheld for the municipal corporation on account of all the employers' employees ... exceeds $150 for a calendar year beginning on or after that date."

  • All municipalities must accept any generic tax form from a taxpayer, provided it contains all the information necessary for filing. Rules and tax forms must be available through the Internet by 2002.

    "If you work in 60 different suburbs in Cleveland, you've got to go get 60 different forms under the current law," Liggett says.

  • Municipalities must have an appeals process by which an employer can contest payments.

"Because of the size of some of these returns, it didn't behoove the contractor to fight claims by municipalities," says Ellerbrock, noting that often the municipalities did not have an appeals process, forcing the business to go to court to battle disputes. "If they say you owe $100 and you say you owe $50, how much time are you going to spend fighting it? You can't justify the cost."

The new law sets up appeals guidelines -- and requires municipalities to establish boards of appeals. A taxpayer will have 30 days to appeal a tax administrator's decision, and appeals boards must schedule hearings within 45 days of the appeal. The board must issue a decision within 90 days after the final hearing and send a notice of its decision to the taxpayer within 15 days. How to reach: Luther Liggett Jr., Bricker & Eckler LLP, (614) 227-2399. Details and links regarding the new law are available on the firm's Web site at www.bricker.com/legislation/HB477.asp. For the full text of the law, go to www.legislature.state.oh.us/bills.cfm?ID=123_HB_477 on the 123rd Ohio General Assembly's Web site.

Governor honors technology innovators

Gov. Bob Taft has honored eight Ohio companies for their dedication to technology.

Cleveland-based Keithley Instruments Inc. received the 2000 Thomas Edison Award, which recognizes one outstanding Ohio company or organization that has demonstrated global leadership in fostering or implementing innovation. The award honors a firm that utilizes technology to impact not only its own operations but also the quality of life in its community, the state of Ohio and around the world.

The governor also presented Emerging Technology Awards to small, technology-oriented firms that are making valuable progress in the advancement of new or existing technologies. The winners were BIOMEC Inc. and USB Corp. of Cleveland, Exciton Inc. of Dayton, fourthchannel inc. and LeadScope Inc. of Columbus, PlanetFeedback.com of Cincinnati and Sorbent Technologies Corp. of Twinsburg.

For more information about the awards, contact the Ohio Department of Development's Technology Division, (800) 848-1300, or visit www.odod.state.oh.us/tech.

Business mission set for March

The governor has announced plans to lead a delegation of Ohio companies on a business mission March 3-17, 2001, to South America.

Gov. Taft aims to enhance Ohio's trade position in the South American market, introduce Ohio companies to business opportunities in South America and assist Ohio companies already doing business in the region.

Business sectors to be featured on the mission include telecommunications, pollution control, medical and health care, plastics machinery, automotive, processed foods, packaging and food processing equipment, as well as agriculture and mining industry equipment.

The cost of the mission is expected to be approximately $13,500 per person, which includes all air and group ground transportation, accommodations and business meetings.

Ohio companies interested in participating should contact Randy Hochstetter, mission coordinator, in the Ohio Department of Development's International Trade Division at (614) 466-5017 or (800) 848-1300. Agribusinesses should contact Liana Lee, chief of the Ohio Department of Agriculture's Division of Markets, at (614) 466-5338. Joan Slattery Wall (jwall@sbnnet.com) is an associate editor and statehouse correspondent for SBN.

Monday, 22 July 2002 09:32

Less taxing

Next year, when the tax man cometh, companies that do work in many cities in Ohio will have a much shorter stack of paperwork.

Provisions of Substitute House Bill 477 take effect Jan. 1 and create uniformity for municipal tax filings across the state.

"[Under current law] it's not unusual for a small contractor to have to fill out 40, 50, 60 returns - in addition to your federal income tax return and your state income tax return," says Donn Ellerbrock, vice president for governmental affairs for Associated General Contractors of Ohio.

Luther Liggett Jr., a law partner with Columbus-based Bricker & Eckler LLP, explains that current law requires employers to withhold tax and file forms for any employee working within a municipality's limits, even if neither the employee nor the employer reside in that city.

Contractors who, for example, go into a subdivision for a day or two of repairs may end up owing only a few dollars, says Liggett, who also is a legislative agent for a variety of construction associations, such as the National Electrical Contractors Association.

"Interestingly enough," says Ellerbrock, "before 477, frequently firms would have to spend more to comply than they owed."

The new law's benefits, effective Jan. 1, 2001, include:

  • A city cannot tax income if an individual performs services on 12 or fewer days in the calendar year and neither the employee's residence nor the company's principal place of business are in the municipal corporation.

    That individual's employer will not have to count such compensation in payroll factors used to report the business's income to the municipal corporation.

    In addition, the law says no municipality may require any nonresident employer to deduct and withhold income taxes "unless the total amount of tax required to be deducted and withheld for the municipal corporation on account of all the employers' employees ... exceeds $150 for a calendar year beginning on or after that date."

  • All municipalities must accept any generic tax form from a taxpayer, provided it contains all the information necessary for filing. Rules and tax forms must be available through the Internet by 2002.

    "If you work in 60 different suburbs in Cleveland, you've got to go get 60 different forms under the current law," Liggett says.

  • Municipalities must have an appeals process by which an employer can contest payments.

    "Because of the size of some of these returns, it didn't behoove the contractor to fight claims by municipalities," says Ellerbrock, noting that often the municipalities did not have an appeals process, forcing the business to go to court to battle disputes. "If they say you owe $100 and you say you owe $50, how much time are you going to spend fighting it? You can't justify the cost."

The new law sets up appeals guidelines -- and requires municipalities to establish boards of appeals. A taxpayer will have 30 days to appeal a tax administrator's decision, and appeals boards must schedule hearings within 45 days of the appeal.

The board must issue a decision within 90 days after the final hearing and send a notice of its decision to the taxpayer within 15 days. How to reach: Luther Liggett Jr., Bricker & Eckler LLP, (614) 227-2399. Details and links regarding the new law are available on the firm's Web site at www.bricker.com/legislation/HB477.asp. For the full text of the law, go to www.legislature.state.oh.us/bills.cfm?ID=123_HB_477 on the 123rd Ohio General Assembly's Web site.

Joan Slattery Wall (jwall@sbnnet.com) is asociate editor of SBN Columbus.

Monday, 22 July 2002 09:32

Don't let 'em get away

What would you do if you were losing half of your potential client base? What if your local competitors were, too?

Car dealerships in Licking County have faced this exact situation, and they've banded together to catch the attention of customers who are taking their business across county lines.

Newark-based Park National Bank, which helps finance some of the new car purchases in Licking County, initiated a five-month "Buy Local" campaign four years ago. In October 1999, the bank headed up another three-month campaign, which the dealers found so successful they've continued it on their own.

"Our concern, I think, arose from looking at some statistics that roughly half of the new cars that are purchased by Licking County residents are purchased from new car dealers outside of Licking County," says Jerry Nethers, Park National's vice president and director of marketing.

"It's not good for us for a number of reasons. The tax base is improved if we have more people selling cars, making money, getting cars serviced here," Nethers explains. "And while it doesn't directly affect the school taxes, if indeed we got a whole lot of that [business] back, we'd probably have more investment in new dealerships," which could lead to more tax funding for schools.

"If we could get some of the people buying from the huge Franklin County dealers that advertise so heavily in Licking County to buy from Licking County dealers," Nethers says, "then there's the potential for significant growth."

Of course, Park National stands to gain something from the campaign, too. "We get a much better percentage from financing of cars purchased locally than out of town," Nethers says.

Park National paid for the marketing of the campaign originally; now the dealers share the cost of print, radio, television and cable advertising.

The Advocate newspaper in Newark did research for the dealers and gave them some ammunition in their fight: Licking County dealers offered better prices than those in Franklin County. For example, the average price of a new car in Franklin County was $22,254; in Licking County, it was $20,943.

"We did notice a significant measurable increase over the five-month period of time [the campaign first ran] -- a several percentage point improvement in retention of business by local car dealers," Nethers says.

The campaign's revival in 1999 has lasted more than a year.

"All participants are very community oriented, and because of those commitments and the cooperation within the group, the campaign has been successful," says Michael Sexton, president of Indian Mount Pontiac/Mazda.

Customers are even telling Licking County dealers -- via surveys -- that a desire to buy locally influenced their decision to purchase from them.

To add an incentive for customers, the dealerships were, at one point, donating $10 to the local school of the buyer's choice. If the car was financed through Park National, the bank added another $10.

"It doesn't sound like a lot," Nethers says, "but we've ended up distributing close to $20,000 to our schools -- undesignated, so they could do what they wanted with it." How to reach: Jerry Nethers, Park National Bank, (740) 349-8451; Michael Sexton, Indian Mound Pontiac/Mazda, (740) 522-5100

Joan Slattery Wall (jwall@sbnnet.com) is associate editor of SBN Columbus.

Tuesday, 26 February 2002 12:57

Take a test drive

Looking for a way to test, port or research new software?

Platform Lab, a nonprofit entity located within the Business Technology Center on Kinnear Road, is a shared facility providing resources for the IT needs of Central Ohio businesses.

You can configure the physical layout of the facility to suit your needs, receive technical support and avoid unnecessary investment by using Platform Lab for a trial run. Reservations give you scheduled access to the facility's secure resources.

The lab will provide technical resources to start-up and established businesses to research, develop and test commercial and in-house applications.

"Any company, for example, that had an application that currently operates on a previous version of Microsoft operating systems like Windows NT and will be upgrading to a new version like Windows XP, they could test the application to make sure they have the right hardware and software configured correctly so the application meets their expectations," says Steven Clark, director of information technology for the Business Technology Center.

Companies developing new software also could use the lab once they arrive at the testing phase, he says.

The facility, which opened in November, includes popular mid-size hardware platforms, technical hardware and leading database support, secure external network access as well as physical access, and development software, testing tools and software analysis tools.

The lab has partnered with companies including IBM, Microsoft, Oracle and Embarcadaro Technologies to help bring in resources.

Users pay weekly rental fees for the labs.

"If you're making a large commitment to use a platform lab over a period of time, you get a preference and a little better pricing," Clark says. "If you're a walk-up customer and you didn't plan to use the lab but you need it immediately, then the price would be a little bit higher."

Platform Lab is supported jointly by a partnership of the Ohio Supercomputer Center and the Business Technology Center with assistance from the Ohio Department of Development Technology Action Fund, Ohio IT Alliance and industry vendors. How to reach: Steven Clark, BTC, 675-3714, sclark@osu-btc.com or www.platformlab.org